Policy Briefs

Stolen Dreams or Collateral Damage: Climate and Economic Growth in Time of COVID-19

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No.

PB 63

Publisher

ERF

Date

November, 2021

Topic

Q. Agricultural and Natural Resource Economics, Environmental and Ecological Economics

Q5. Environmental Economics

In a nutshell

Climate change is a pressing challenge to humanity, its awareness is continuously rising, and especially amongst young generations. Global warming is constraining the entire world, and the Middle East and North Africa (MENA) region is no exception.
Rising temperatures and sea levels, extreme weather fluctuations, and food and water insecurity are a few symptoms of the ongoing problem.
While higher temperature levels adversely impact GDP growth in the MENA region, in- creased economic activities contribute significantly to higher temperature levels.
Higher precipitation levels could contribute to higher growth rates in the MENA region, while higher growth rates may lead to lower precipitation levels.
Bidirectional causality between climate change and economic growth in the MENA region is affected by exogenous shocks like COVID-19. Emergency action is indispensable to limit catastrophic climate disruptions.
Public discussion about financing adaptive measures should be held.
Future generations may well be better off inheriting a preserved climate and financial debt rather than preserved public finances and permanent damage to the environment.